According to Article 14.8.6 of NASDAQ OMX Riga Rules “On listing and trading of financial instruments on the markets regulated by the exchange”, the JSC “Liepājas Metalurgs” clarifies that the Non-audited Annual Report 2011 contained a consolidated profit of 2315817 LVL, however the Audited Consolidated Annual Report contained profit of 3886052 LVL. Such a difference shall be explained by the fact that in October 2011 the JSC “Liepājas Metalurgs” made long-term financial investments in the equity of SIA “Liepājas naglas” and the previous years profit of the mentioned subsidiary, included in the Non-audited Annual Report, and the difference between equity capital and acquisition value was indicated in the Annual Report as retained profit of previous years.

 According to the guidance of sworn auditor, the previous years profit of subsidiary in amount of 808444 LVL, so as the difference between equity capital and acquisition value of 461944 LVL, shall be considered as the investment profit of the JSC “Liepājas Metalurgs”.

Such changes affected also calculated deferred tax. In the Non-audited Annual Report, for all enterprises involved in the consolidation, deferred tax was calculated in accordance with non-audited data and without filling a final income declaration of enterprise. Such actions affected the deferred tax.

It was: -163146 LVL in the Non-audited Annual Report and +163238 LVL in the Audited Annual Report. This occurance has changed the final result and increased profit by 326384 LVL.

By conducting the Audited Annual Consolidated Report, cost and revenues were verified which lead to a profit reduction of 26537 LVL.

         Līga Šenfelde
         Assistant of the Chief Economist
         t.: +371 63455926, shenfelde@metalurgs.lv